profit forecasts 2011-2015...5yr ave pe of 4.5

After doing a few numbers on Norton I've done some rough forecasts for the next 5 years. Some of the assumptions are below (sourced from their releases) but there are too many to mention. I'll try and answer any questions etc.

I would note the 2011 Full year is going to be pretty noisy with refinance fees on the Lehman debt, one-off Coal asset sale gains, hedge adjustments etc so 2011 forecast is more a normal earnings guess. All in A$.

Assumptions:
Year 2011 2012 2013 2014 2015
Production 156.5koz 160koz 160koz 180koz 180koz
C3 Costs A$1134 A$1120 A$1075 A$958 A$1005
Ave Gold Price A$1375 A$1375 A$1350 A$1325 A$1300

Income 215.1m 220m 216m 238.5m 234m
Cost of Sales 177.4m 179.2m 172m 172.5m 181m
Gross Profit 37.7m 40.8m 44m 66m 53m
less
Administration 10.0m 9.0m 9.0m 9.0m 9.0m
net Financecost 10.5m 4.5m 4.0m 3.0m +2.0m
Pre-Tax Profit 17.2m 27.3m 31.0m 54.0m 46.0m
Tax 5.2m 8.2m 9.3m 16.2m 13.8m
NPAT 12.0m 19.1m 21.7m 37.8m 32.2m
NPV @ 11% 12.0m 17.0m 17.2m 26.6m 20.2m

Total Earnings 2011-2015 NPV @ 11% = A$93m or 14cps.

I think these numbers are reasonably conservative and shows me that Norton is pretty cheap at 16cps. On 5 year average earnings they are on a PE of only 4.5 with a resource which should stretch past 10 years.

Anyway, as I said the 2011 number will not be very clean but the company does look to be cleaning itself up overall and I think the results the next 2-3 years will prove this is a decent gold miner.

Good luck all
Arbroath